COMMISSIONER OF INCOME TAX Vs. G KRISHNAN

JUDGEMENT

(1.) AT the instance of the Department, the Tribunal referred the following two questions, for the opinion of this court, under section 256(1) of the Income-tax Act, 1961 (hereinafter referred to as "the Act") "1. Whether, on the facts and in the circumstances of the case, the Tribunal's finding that the bonus of Rs. 1, 50, 000 earned by the assessee on the sale of the prize winning raffle ticket, cannot be assessed as the income from business for the assessment year 1978-79 is correct in law ?.2. Whether the Appellate Tribunal's further finding that the bonus receipt of Rs. 1, 50, 000 would also partake of the character of winnings from lottery and be assessable under section 2(24)(ix) with attendant relief under section 80TT is correct in law and reasonable view to take on the facts obtaining in this case ?" *

(2.) THE assessee is an accredited agent for selling Tamil Nadu raffle tickets for Sivakasi, governed by the agreement, dated October 12, 1976, under the Tamil Nadu State Raffle Rules, 1976. THE assessment year involved in this case is 1978-79. THE relevant portion in the agreement for the purpose of this tax case is as underTHE agent shall be entitled to receive a commission of 111/2 per cent. on the face value of the tickets in the ticket books purchased by him, which commission shall be deducted from the total value of the ticket books purchased by him. THE agent shall also be entitled to receive a bonus equivalent to 10 per cent. of the prize amount, if any, won by the tickets sold by him, on production of the voucher issued to him by the sub-treasury at the time of purchase of tickets for every draw. During the accounting year, relevant to the assessment year 1978-79, apart from the commission receipt of 111/2 per cent. on the face value of the tickets in the ticket books purchased by him, the assessee also became entitled to the bonus equivalent to 10 per cent. of the prize amount of winning ticket No. 6852288.

(3.) THEREFORE, according to learned senior standing counsel in view of the decision in Visveswaraiah Lucky Centre v. CIT 1991 (189) ITR 698, 1991 (93) CTR 261, 1991 (56) TAXMAN 80, 1991 (93) CTR(Kar) 261 (Kar), the Tribunal was not correct in holding that the bonus is assessable under section 2(24)(ix) of the Act. According to learned senior standing counsel inasmuch as the bonus is not a winning from a lottery, the assessee is not entitled to the benefit under section 80TT of the ActWe have heard learned senior standing counsel appearing for the Department and perused the records carefully. The assessee is an accredited agent appointed for the sale of the Government raffle tickets issued at the sub-treasury at Sivakasi, for a period of one year from the date of appointment or till August 25 of the year, whichever is earlier. In the accounting year, relevant to the assessment year 1978-79, under an agreement, dated October 12, 1976, entered into between the assessee and the Government as per the Tamil Nadu State Raffle Rules, 1976, the assessee purchased raffle tickets from the sub-treasury. According to one of the clauses contained in the agreement dated October 12, 1976, the agent shall be entitled to receive a commission of 111/2 per cent. on the face value of the tickets in the ticket books purchased by him, which commission shall be deductible from the total value of the ticket books purchased by him.